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© X FAB Business | August 21, 2017

X-Fab sales up 18% YoY

During the second quarter of 2017, X-Fab posted sales of USD 139.3 million and net profit of USD 24.1 million. Compared to the second quarter of 2016, sales show an increase of 18 percent.
Compared to the previous quarter sales were 6 percent lower due to lower subcontracted revenue from consumer products. Gross profit was USD 23.9 million, a decrease of 2 percent compared to the same quarter last year and a decrease of 18 percent compared to the previous quarter. The operating income was USD 9.2 million, a decrease of 24 percent compared to the same quarter of last year and a decrease of 21 percent compared to the previous quarter.

Net profit of the quarter was 87 percent higher compared to the same quarter last year and increased by 115 percent compared to the previous quarter, mainly due to the strong net financial result. The subcontracted business represented USD 3.2 million for the second quarter 2017 with a corresponding operating profit of USD 0.7 million.

Outlook

For the third quarter, X-Fab expects USD 138-143 million in revenue, with an EBITDA at about 19 percent. For the rest of the year, the company expects a further shift toward a higher share of automotive, industrial and medical business and is currently forecasting the subcontracted consumer business at zero. As a result, the company expects the EBITDA margin of the fourth quarter to come in at around 20 percent.

Rudi De Winter, CEO of X-Fab, comments: "X-Fab further increased utilisation in its factories. The integration of X-Fab France is going well. As planned, we have delivered products for product qualification from X-Fab France on X-Fab’s proprietary technologies to selected customers. We are planning first production starts this quarter.

The strong NRE revenue realised in the second quarter of 2017 in the amount of USD 13.0 million shows the strong interest in our technologies. It also is a good indicator for future production revenue. Sales in our core markets automotive, industrial and medical totalled USD 82.9 million, an increase of 24 v compared to the same quarter last year and 7 percent higher compared to the previous quarter. The share of automotive, industrial and medical markets increased from 52.2 percent in the previous quarter to 59.4 percent in the second quarter of 2017. A higher exposure to our core end markets improves the overall visibility. Based on the strong automotive, industrial and medical outlook for next year, we have fine-tuned our CAPEX plan and pulled in a USD 40 million CAPEX in our factory in Malaysia to expand capacity by 4'000 wafer starts per month, which will become effective as of Q1/2018. Also our SiC activity in our factory in Texas is developing according to plan and we delivered wafers for product qualification. This will result in first SiC production revenue in the second half of this year.

I am excited about the progress made with the products for molecular biology applications. One of our customers, a major player in the field of next generation DNA sequencing, has passed FDA approval for oncology applications. As these tests identify biomarkers in tumour samples for a growing amount of FDA approved therapies, the market for these semiconductor-based test devices will exponentially increase for a while. This is an example of the unique specialty processes X-Fab develops with its customers for a wide range of applications and in particular for the medical market.”

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December 13 2017 10:15 PM V8.9.2-1